Bloomin’ Brands’ $26.3 million proposal for Out West Restaurant Group’s assets faces a court-supervised sale after the operator of 61 western U.S. Outback Steakhouse restaurants filed for Chapter 11 protection in Delaware.
Cerca Trova Restaurant Group Holdings Inc., which does business as Out West, filed on Nov. 2. Bloomin’ Brands signed the asset purchase agreement the day before, according to a company filing. The proposed transaction covers substantially all of Out West’s assets, rather than only its restaurants.
The $26.3 million base price would be reduced by amounts Out West owes under a proposed financing facility if Bloomin’ Brands completes the acquisition. If another buyer acquires the assets, the financing instead would be repaid from the sale proceeds. The price could increase dollar for dollar if specified vendor liabilities assumed at closing are below $6.1 million. Bloomin’ Brands would also take on certain liabilities, including future lease obligations, unredeemed gift cards and specified vendor liabilities.
Bloomin’ Brands agreed to provide up to $5.5 million in non-interest-bearing debtor-in-possession financing, subject to court approval and other conditions. Out West could draw $1.5 million after an interim approval order. The remaining amount would become available after final approval and approval of bidding procedures.
Bloomin’ Brands is expected to be named the stalking-horse bidder if the bankruptcy court approves the proposal. Other buyers may offer higher or otherwise better terms, and qualifying bids could lead to an auction. The agreement sets Jan. 31, 2027, as the outside closing date unless extended; the sale itself requires court approval.
Bloomin’ Brands said the filing would not immediately affect guests, employees or daily operations. Out West plans to keep operating under court oversight. Bloomin’ Brands said securing the restaurants would give it direct operational insight and allow it to invest in them through its development initiatives.
A 2023 agreement among Bloomin’ Brands, Out West and its lenders addressed payment deferrals and forbearance after earlier defaults. Bloomin’ Brands’ filing said the Chapter 11 case automatically paused termination of that agreement, leaving the parties’ rights to be resolved in the bankruptcy proceedings.
